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peterwn

And Grant Robertson (the shadow minister for the PSA) was effectively spouting the opposite yesterday. In 1999 Helen Clark promised higher taxes to pay for more health, welfare and education and many voters fell for it. Instead her government used the money to pay for more pen-pushers, tighten political control of the public service and to support various ideological things. It did not deliver very much in the way of extra services.

tom hunter

No, Chavez became the bugaboo of American politics because his full-throated advocacy of socialism and redistributionism at once represented a fundamental critique of neoliberal economics, and also delivered some indisputably positive results. Indeed, as shown by some of the most significant indicators, Chavez racked up an economic record that a legacy-obsessed American president could only dream of achieving.

For instance, according to data compiled by the UK Guardian, Chavez’s first decade in office saw Venezuelan GDP more than double and both infant mortality and unemployment almost halved.

There’s more about how wonderful it all was: I love the way the typical future of such states is dismissed with a wave of the hand, as if ten years is proof that a country cannot be ruined by socialism and vast government spending.

When a country goes socialist and it craters, it is laughed off as a harmless and forgettable cautionary tale about the perils of command economics. When, by contrast, a country goes socialist and its economy does what Venezuela’s did, it is not perceived to be a laughing matter – and it is not so easy to write off or to ignore. It suddenly looks like a threat to the corporate capitalism, especially when said country has valuable oil resources that global powerhouses like the United States rely on.
…
… at a moment when America faces a pivotal debate about taxation and the size of government in specific and free market fundamentalism in general, Chavez’s passing should prompt as much reflection on the individual iconoclast as on the overarching economic ideas he came to embody.

To start, that means asking important questions.

Oooooo yes, “important questions” about redistribution and the size of government are always raised by these Potemkin farces – like why the USA was not matching the GDP growth rate of the USSR under Khrushchev.

The problem is that even gently raising them typically gets one tarred and feathered as a communist and then inevitably called a Hugo Chavez pal
…
But maybe now that the iconoclast is dead, the cartoon will end. Maybe now Chavez’s easily ridiculed bombast can no longer be used to distract from Venezuela’s record – and, thus, a more constructive, honest and critical economic conversation can finally begin.

Wah, wah, wah. That was in 2013. I wonder if this rube – and Salon.com – are willing to engage in “a more constructive, honest and critical economic conversation” in 2016.

tom hunter

In the last two years Venezuela has experienced the kind of implosion that hardly ever occurs in a middle-income country like it outside of war. Mortality rates are skyrocketing; one public service after another is collapsing; triple-digit inflation has left more than 70 percent of the population in poverty; an unmanageable crime wave keeps people locked indoors at night; shoppers have to stand in line for hours to buy food; babies die in large numbers for lack of simple, inexpensive medicines and equipment in hospitals, as do the elderly and those suffering from chronic illnesses.

But why? It’s not that the country lacked money. Sitting atop the world’s largest reserves of oil at the tail end of a frenzied oil boom, the government led first by Chavez and, since 2013, by Maduro, received over a trillion dollars in oil revenues over the last 17 years.

It faced virtually no institutional constraints on how to spend that unprecedented bonanza. It’s true that oil prices have since fallen—a risk many people foresaw, and one that the government made no provision for—but that can hardly explain what’s happened: Venezuela’s garish implosion began well before the price of oil plummeted. Back in 2014, when oil was still trading north of $100 per barrel, Venezuelans were already facing acute shortages of basic things like bread or toiletries.

But retards like David Sirota will learn nothing more than they did from the collapse of the USSR. The next Chavez that appears in the world screaming about how more government spending will help the poor, will be lauded to the skies by the same dickheads.

Sorry Tom, can you remind us how Venezuela brought the global financial system to the point of collapse?

At least Venezuela’s problems are largely confined to Venezuela, the neoliberal model of unrestrained flows of speculative capital is causing the kinds of market distortions similar to those that ignited the Great Depression. Cheap credit is less likely to be invested in tangible enterprises which return a net benefit to society, cheap credit is more likely used to speculate on the price of property or shares increasing dramatically in a economic environment of low inflation .

The Bangles

Yoza, the answer to that is the gold standard. Central banks can make credit cheap for now, and then once prices go up, they raise interest rates again, to choke inflation. With gold as money you have a steady and small rate of monetary growth, with interest rates where they should be. Who’s promoting this? The austrians, believe in limited government which includes not being able to print off money.

blazeoflight

@The Bangles

I guess economic history isn’t your strong point. We have tried the gold standard: disaster. We have tried controlling the money supply: disaster.

And what do you mean by ‘interest rates where they should be”? If you mean all central bank interest rates in the rapidly ageing developed should be negative, then I could agree. But I suspect you are so stupid as to be suggesting the opposite.

As for the quote, well, the Taxpayers Union – real unions should sue them for misrepresentation – folk are simply myopic, if they really believe their shit, or, more probably, expressing a let them eat shit life view.

The US, of which Norquist is speaking, is woefully undertaxed and this is reflected in its failing infrastructure.

A major problem is that as the share of income accruing to capital increases, the wealthy use their political clout to underpay their taxes – and in NZ, we basically pretend capital income doesn’t exist.

The Bangles

Blaze, I guess you still aren’t getting it. When the government can create as much money as it wants, this means temporarily interest rates can be low. Suppose their is a recession, so they say let’s make interest rates lower by decree. People borrow more, the money supply goes up. Whereas if you had a 4% growth per year as the monetarists say, or have the money supply tied by gold you don’t have this problem. The government can’t make the money supply grow by too much.

And when America was on the gold standard, the national debt was far less.